Standing Committee E

[Mr. John Maxton in the Chair]

Health and Social Care Bill

Clause 45 - Care Trusts where voluntarypartnership arrangements

Paul Burstow: I beg to move amendment No. 295, in page 38, line 12, leave out
`is, or is to be, a party'
 and insert 
`and a local authority are, or are to be, parties.'. 
The clause and part III of the Bill establish a useful innovation—a tool for developing integrated care services—and we want to explore how it will be used. Although we welcome the policy intention, a number of organisations have expressed concern about how it will be translated into practice. The Local Government Association has made representations to all hon. Members about its underlying unease, and the amendment attempts to address that unease. Nevertheless, we support the proposition that there should be more joint working and that the flexibilities in the Health Act 1999 should be built upon. A structure of the sort envisaged in the clause is one way to achieve that integration. 
 The Bill makes it clear that the mechanism to establish the new care trusts voluntarily does not allow for equal partnership between the two agencies. The amendment seeks merely to put local authorities on an equal footing with the NHS bodies with which they will working to put the new independent care trust arrangements in place. It should be a marriage of equals, leading to an entity that is genuinely the product of the two organisations. 
 I suspect that I will stray too far, Mr. Maxton, if I start to raise other questions about the clause during this debate. I hope that we shall have the opportunity on clause stand part to probe some of the issues not dealt with in amendments. Suffice it to say that I hope that the Government will respond positively to this amendment and to several others. That will help allay the concerns of local authorities and enable them to enter into such arrangements with full commitment, which will allow better services to be provided jointly between health and social services.

Desmond Swayne: I share the concern and hence understand the motive behind the amendment. Indeed, it sets the theme for many of our amendments to this and the next three clauses. The Bill makes no provision for local authorities to take any responsibility for health services, or even to share the responsibility equally with health trusts. In essence, we are talking about the removal of statutory responsibilities from democratically elected local authorities and local government management by what is fundamentally an NHS body. That begs all the questions that were raised in previous sittings about the centralised nature of the NHS, about micro-management and about the lack of accountability and scrutiny. That is all reinforced in the clause, which changes an accountable local authority function to one that is less accountable.
 On Second Reading, the Secretary of State said: 
 ``Incidentally, I do not believe that the best way forward for local government and social services is to have a national health service takeover.''—[Official Report, 10 January 2001; Vol. 360, c. 1089.] 
We share that view. We believe that the accountability of local authorities is an important principle that should be preserved within care trusts. It should not be diluted in the provision of services to local people. 
 The Leonard Cheshire organisation states: 
 ``Trusts will effectively be NHS bodies. This signals real dangers. Firstly and most importantly, that the whole culture underpinning the commissioning process for primary/community care services will be medicalised. This poses a direct and significant threat to the understanding and use of the social model of disability by providing agencies.'' 
I take that last stanza, so far as I understand it, to mean that local authority provision has had the objective of supporting people in their own homes where possible. The emphasis of the NHS may be different, with its concerns for treating ill health. 
 We share the concerns behind the amendment and are favourable to it.

John Hutton: I welcome what the hon. Member for Sutton and Cheam (Mr. Burstow) said in moving the amendment. He expressed his support, and that of the hon. Member for Isle of Wight (Dr. Brand), for the principle behind care trusts. I suppose that one should accept small mercies when they are offered, and it is always nice when the Liberal Democrats support a Government policy. I shall try to deal with some of the problems raised by the hon. Members for Sutton and Cheam and for New Forest, West (Mr. Swayne).
 The hon. Member for Sutton and Cheam will recognise that the amendment is modest and minor. He will not be surprised when I tell him that what it tries to do is fully covered by the Bill already. It is clear from clause 45 that care trusts are voluntary arrangements, in the sense that they are entered into by local authorities and the national health service. His suggestion that we need to make the role of the local authority explicit in applying to the Secretary of State for an order establishing a care trust is met already by the clause. The amendment is unnecessary. 
 The hon. Member for New Forest, West raised two concerns. They went slightly beyond the amendment, but I want to say something about them now. We are aware of many organisations' concerns about the model of care trusts that we propose in the Bill. However, I hope that none of us disagrees about the principle behind the care trust concept. We all know about the problem that we are trying to tackle. In our surgeries, we have all no doubt met constituents who felt that they had to navigate themselves around the care system, from pillar to post, between the NHS, social care and other agencies. For many, that is not a happy experience. In the past three and a half years, we have consistently tried to develop a much closer proximity between health and social care agencies. It is right in principle and practice that the two key and equal partners in the care system should more closely co-operate. 
 The hon. Gentleman is wrong to say that local authorities will lose responsibility for social services functions under clause 45. They will delegate functions but will retain overall responsibility for them, even in the context of a care trust. There is no question about where the overall social services responsibilities lie.

Paul Burstow: Will the Minister shed further light on the Government's intentions about where responsibility will lie when a care trust has been established? As the Minister knows, local authorities have discretionary powers in respect of charging policies for home care services and for other services that in future may be delivered by care trusts. Where will the responsibility lie for determining the charging policy and the eligibility criteria on which it is based?

John Hutton: I am genuinely surprised that the hon. Gentleman asked that question because we have answered it on several occasions. We have made it clear that the responsibility for determining charges for social services will rest with the local authority. There is no question of charging for NHS services that are delivered by a care trust. They will remain free at the point of use, and that will remain the case as long as the Government are in office.
 The hon. Member for New Forest, West raised another concern, which has been doing the rounds. He quoted the Leonard Cheshire organisation, for which I have a great deal of admiration and respect. It does an outstanding job for many disabled people. However, there is a misunderstanding here about the nature of care trusts. They will not somehow medicalise social care. It is clear from what we have said and how we envisage care trusts being established that there will be a distinctive role for social care services delivered under the umbrella of a care trust. We are not proposing some ideological shift in values and culture in relation to the delivery of social care services. We just want them delivered in a more coherent way, positioned more closely alongside the NHS, as equal partners in the care system. It is important that Committee members understand that we are not proposing that the establishment of care trusts will lead to the end of social services and the current concept of social care. That would be ridiculous.

Paul Burstow: I apologise to the Minister for interrupting his flow. He is making an important point, which addresses a concern that is shared by many outside the House about how care trusts will work in practice and his assurances are most helpful. Has he considered the recent research evidence on the experience of integration—albeit on a different structure—in Northern Ireland, which revealed concerns that placing social care in the context of a health body has lead to a domination of the medical model over the social model? The LGA cited that evidence. Has the Minister had a chance to consider it? If he has, does he accept it, and if so, what guidance will be made available to ensure that the pitfalls of the system in Northern Ireland are avoided in the United Kingdom?

John Hutton: I have to be honest with the Committee and say that I have not seen that research, but I will dig it out. It is probably on somebody's shelf at the Department of Health and perhaps later today I will look at the executive summary.
 Many admire the system of health and social care delivery in Northern Ireland, not least the Select Committee on Health, which looked favourably on the system. Perhaps the hon. Member for Isle of Wight, who is a leading member of that Committee, will advise us to the contrary. The Select Committee on Health did not think that bringing health and social services closer together would necessarily lead to the hon. Gentleman's proposition, that there would inevitably be a drift toward the medicalisation—whatever that is—of social care services. That is absolutely not what we have in mind. 
 There is a distinctive and clear role for social care services. That role will continue under the umbrella of a care trust if, under clause 45, that is what local partners decide is the most appropriate vehicle under. 
 I will deal fully with some of the other wider concerns about care trusts later in our proceedings. I understand the spirit behind amendment No.295, but the concerns raised by the hon. Member for Sutton and Cheam are unfounded in relation to clause 45, which fully recognises that the arrangements will be voluntary. Local partners will apply to the Secretary of State for designation as a care trust. The amendment is legally unnecessary and would not help the drafting of the clause.

Paul Burstow: I am sure that the LGA and others will have listened carefully to the Minister. Perhaps we will return to the matter if others outside the House are not persuaded by what he has said. On the basis of the assurances that he has given to us today, I beg to ask leave to withdraw the amendment.
 Amendment, by leave, withdrawn.

Desmond Swayne: I beg to move amendment No. 310, in page 38, line 21, leave out from `made' to end and insert—
`(a) after consultation with all statutory patient representative bodies in existence at the time the application is made; and
(b) where a report on the consultation undertaken in accordance with subsection (a) above accompanies the application and the designated authority is satisfied that the consulted bodies concur with the application; and
(c) where the application is made jointly by every prescribed body.'.

John Maxton: With this it will be convenient to take amendment No. 291, in page 38, line 21, at end insert—
`which application shall include details of the outcome of the consultation process regarding the application with those organisations representing health and social services users and with those who are users of either health or social services in that area, and with representatives of the local community'.

Desmond Swayne: Amendment No. 310 is about consultation, which we consider to be of considerable importance. The amendment requires that the statutory patient representative body be consulted when an application for formation of a care trust is made. Where a report is produced consequent upon that consultation, it should partly determine whether the trust is formed. We have received many representations, principally from the Royal College of Nursing, Age Concern and Help the Aged. Those representations all concerned the need for consultation, which is why we attach such importance to the amendment.
 The formation of a care trust is a major undertaking. It will involve the shifting of statutory responsibilities, which will imply a major shift of resources, staff and information systems. That is bound to have a significant start-up cost in financial and organisational terms. Inevitably, it will cause disruption. There must be clear evidence that the process will result in a significant improvement in the quality of service provided. 
 It is well known that it will be horses for courses as far as care trusts are concerned. Some local authorities will not want to enter into such arrangements, but others will, to the clear benefit of those whom they serve. The amendment seeks to ensure that the decision to do so should be based on evidence. All innovation should be based on evidence. I understand that that is the principle that underpins the National Institute for Clinical Excellence. It is also the principle that will underpin the social care institute for excellence. 
 What evidence will be required to prove that a proposed care trust will be more effective in providing social care than the local authority? We look to consultation as the main source of such evidence. That is why we consider it to be important. It is through consultation with those who will be served by the arrangement that we seek the justification for proceeding with it.

Paul Burstow: The group of amendments includes amendment No. 291, which is in my name and that of my hon. Friend the Member for Isle of Wight. We, too, want to pick up on a matter on which we have received representations, relating to the nature of the process of consultation that will be undertaken in respect of the establishment of care trusts. A briefing note was helpfully circulated in advance to the Committee, for which I am grateful to the Minister and his departmental team, because it fleshes out the proposals that are set out in the explanatory notes. It refers to a prescribed period of meaningful consultation, and offers us the prospect of guidance on the details of the future arrangements. I hope that the Minister will be able to tell the Committee what issues he and his Department would expect to be covered in such a consultation. There are several matters that need to be aired locally, with respect to consultation.

Peter Brand: Does my hon. Friend agree that if consultation produced significant or even universal opposition to such mergers the Government should pay attention—unlike previous Governments who, for instance, established national health service trusts according to a pattern set down by the Secretary of State rather than by the communities concerned, and in complete disregard of consultations?

Paul Burstow: Flaws of that kind have occurred in past consultation arrangements. However, the briefing notes make it clear that applications
``will need to provide evidence of . . . local support for the proposals''. 
That will be an important consideration for the Minister concerned to take into account. I hope that the question of coterminosity of the organisations coming together to form care trusts will feature in consultation. From the patients' perspective, the boundaries between agencies are often a major obstacle to the provision the seamless service that the Minister described with reference to an earlier amendment 
 A good example exists in my area of the way in which lack of coterminosity could hinder the intended operation of the clause. A primary care trust covers about 20 per cent. of the population of my borough, while a primary care group covers the rest. The Nelson primary care trust might perhaps apply to become a care trust in conjunction with the London borough of Merton, the bulk of whose population it serves. What would happen to a resident of my local authority area who received GP services from within the PCT, and therefore the new care trust, but who was also receiving care packages provided by the local authority social services department of the London borough of Sutton, not the London borough of Merton? How will that state of affairs be unpacked? How could the service be provided in a seamless way? 
 I should have thought that that issue would need to be explored during local consultation processes. I hope that the Minister can shed light on the question today, to inform such processes in the future. 
 Another issue about which many people will want to be informed in the process of local consultation on care trusts is the Government's precise arrangements for those trusts. Will there be direct representation on trust boards for stakeholders such as older people? Will councillors be included? More details of the Government's thinking would be helpful. 
 During consultations representations are likely to be made about the expertise that social services departments have developed in holistic assessments. Those focus on the needs of the user of the service, or patient, alongside the needs of carers. I hope that the Minister can comment on that, not least because he and I spent some time last year in Standing Committee considering the Carers and Disabled Children Act 2000. Arrangements under that Act are designed to ensure equality of treatment between carers and users, through the assessment arrangements. How will that approach be affected by the establishment of care trusts? 
 I particularly want to hear from the Minister about coterminosity, which is lacking in many places and will no doubt frequently be a matter for consultation. I hope that one of the amendments will be included in the Bill.

George Young: I welcome the co-pilot to the controls after a long wait to get to part III of the Bill.
 I want to argue for the consultation process to include certain key matters, some of which were touched on by the hon. Member for Sutton and Cheam and my hon. Friend the Member for New Forest, West. Clause 45 has enormous implications for local government. Social services is one of the most important local authority functions—the most important function after education—and the clause proposes the voluntary transfer of a key responsibility of local authority to a body that is, in effect and in law, a national health service body. When consultation is entered into at local level, I hope that people will ask whether taking such a radical step is the right way forward. 
 Many people believe in local government as an important element of a decentralised society and as a counterbalancing democratic body to central Government. If one takes away services from local government one begins to alter the balance of the constitution. I see that as a step away from a decentralised society towards a more centralised one and from a democratic society to a slightly less democratic one. One is potentially removing a chunk of important services from a body that is democratically accountable to local people to one that comes under the control of the Secretary of State. 
 Some 10 years ago, the Conservative Government looked into setting up an alternative primary care trust as an interface between social services and the health service. We decided not to go down that path, but to give responsibility to local government, partly because we did not want to set up two extra interfaces—one between the care trust and the rest of local government and one between the care trust and the rest of the NHS. When local people are consulted, I hope that a number of questions will be asked: first, about accountability. At the moment if something goes wrong in social services people know who to complain to—their local councillor. There is a clear chain of accountability. If social services are provided by a care trust it is less clear to me what the local councillor would be able to do about a complaint. He would simply say, ``I'm very sorry, but these arrangements no longer come under the county council or district council. They are now in a care trust with its own budget and it is run by a body—yes, we have one or two representatives on it but it is an NHS body.'' I hope therefore that issues of accountability will be raised in consultation.

Lorna Fitzsimons: Does not the right hon. Gentleman acknowledge that currently under the NHS commissioning is allocated between many different bodies that are accountable in different ways to different boards, such as health trusts, health authorities and now the PCTs? There is no problem, so why should there be a problem with the new model, especially given that the elections and accountability in local government are rather more extensive than they are in community health councils?

George Young: If the hon. Lady follows the example that I am about to give, she may realise the issue. At the moment if something goes wrong with care in the community the responsibility rests clearly with social services. People know to whom they should complain. Someone with a grievance goes to his county councillor—or his local councillor if it is a unitary authority—and says, ``The assessment has not taken place. This elderly constituent was entitled to an assessment under care in the community. You have not done it and I want it done.'' That is a matter for the director of social services and the chairman of the social services committee.
 Under the primary care trust system, the local authority transfers into a primary care trust its responsibilities for care in the community. If something goes wrong then and there is a complaint to the local councillor, the local councillor can no longer say, ``I will talk to the chairman of the social services committee and the director of social services and we will have the assessment done. We will make the required adaptation to the downstairs accommodation so that that individual can continue to live there.'' Instead, the person bringing the complaint will be told that responsibility has gone to a primary care trust and the local councillor or the chairman of the social services committee no longer has a direct influence on the outcome: it is a national health service body and the local councillor is just one voice. For that reason it is important that issues of accountability are raised during the consultation exercise. It is not clear cut. The Government have not made at all clear the governance arrangements and chain of accountability under the primary care trust. 
 Another issue that will need to be dealt with in the consultation process is the culture in social services, which is quite different from that in the NHS. For example, social services departments have a charging regime, which has already been touched on by the hon. Member for Sutton and Cheam, while the NHS is free at the point of use. When two cultures are merged—one that charges for services on the basis of means testing and the other that is free at the point of use—important issues will inevitably arise. Which services provided by the primary care trust will be free and which will incur charges? The service is supposed to be seamless and the patient—or customer—is not meant to know at what point in the chain the services are provided. People want an answer to a key question. How will they know that services provided by the primary care trust will not incur charges? 
 The Minister attempted to provide an answer, but if it is a seamless service—and that is the object of the primary care trust—there must be a point towards the social services regime, at which someone says, ``If that service had been provided in the old days, we would have charged for it, so why not charge for it now?'' So the Minister has glossed over some important issues. 
 There are also key issues about resources. Social services receive money through the revenue support grant and the local rates. The county council or the district council debate education and social services, and money is voted to social services, which goes to the care trust. The primary care trust receives its resources straight from the Department via the various tiers in the health service. If something were to go wrong mid year and the primary care trust were heading for an overspend, it would be difficult for the local authority to top it up. It may be easier for the NHS to do so. Those issues have not been considered. 
 Local authority social services departments are well-established, robust bodies. The primary care trusts, on which we propose to put all this responsibility, are hardly up and running. Most parts of the country have a primary care group. The Government plan to impose on untried and untested bodies major responsibilities that are currently well-discharged by local authorities. That is a leap in the dark, and many questions remain unanswered. I hope that at some point—either in this debate or on clause stand part—the Minister will deal with some of the unresolved issues brought up by this radical change in policy.

John Hutton: We started with a debate about consultation, but we have covered just about everything that is likely to be raised about the subject of a care trust--perfectly properly, of course. I shall deal first of with the points that right hon. and hon. Members have made about the importance of consultation. Consultation will be fundamental. In the NHS, when new bodies are brought into existence or services are reconfigured, there is a well-established pattern of consultation, and we intend that to be the case for care trusts.
 I accept some of the points made by the right hon. Member for North-West Hampshire (Sir G. Young) in his helpful contribution to the debate. Care trusts are a big step forward, which is clear from the Bill and the NHS plan. We are attempting to do something that the previous Government considered, but did not do, for a variety of reasons that I am sure he will shine further light on.

Philip Hammond: And rejected.

John Hutton: The hon. Member for Runnymede and Weybridge (Mr. Hammond) says that the previous Government rejected the idea, which is true. We decided to take the step because we wanted to pursue the agenda of partnership working as outlined in the NHS plan. The issue of charging, although it is important, should not frustrate closer partnership arrangements between the NHS and social services. I do not subscribe to his fatalistic view that closer working between the NHS and social care will be frustrated if the social services element is charged for—it is important to bear in mind the fact that not every local authority charges for domiciliary services. That is not the experience in Northern Ireland.

Lorna Fitzsimons: Does my hon. Friend acknowledge that many localities—and I cite Rochdale—have received awards for the seamless service provided currently by social services and the different wings of the NHS when ensuring appropriate after care for our constituents following a stay in hospital?

John Hutton: I agree with my hon. Friend. It would not be hard to find similar examples in other parts of the country. We must approach the establishment of care trusts in a slightly different way. I accept that there may be difficulties and that problems will need to be overcome. However, if we retreat into the second line and say that it is too difficult to explore closer partnership working because the issue of charging is so complicated that it rules out any prospect of those two important organisations working more closely together, we will let down those whom we are here to serve. I believe that there is a way around those problems.
 The right hon. Member for North-West Hampshire said that clause 45 would impose measures on local organisations, but he must be aware that we cannot do that under clause 45. The clause deals with the voluntary establishment of care trusts. By definition, if one of the parties chooses not to establish a care trust, then a trust cannot be established under clause 45. We cannot impose anything on local authorities under clause 45; we want genuine partnership if the parties decide to go down that route.

Philip Hammond: We shall come to clause 46 shortly, but it provides a reserve power for the Secretary of State to compel such arrangements to be put in place. Local authorities and health authorities will therefore be under strong pressure to use the clause 45 route. It is more than a purely voluntary approach.

John Hutton: Of course we will encourage the establishment of care trusts; the concept has a great deal to commend it. It would be a rum state of affairs for a Government to propose a way forward and then to be hesitant about endorsing it or encouraging people to use it. That would be bizarre. It will, of course, be a mixed approach, but we are confident that the flexibility arrangements under section 31 of the Health Act 1999 will deliver improved co-operation and partnership between health authorities, trusts and local authorities. That nut can be cracked in a variety of ways.
 The Opposition are entitled to be cynical; some would say that that is their role. However, the right hon. Member for North-West Hampshire has been in my shoes and worn my jacket—he is welcome to it!—and he should know that it is the responsibility of Ministers to deal with the problem of getting social and health care services to work more closely in partnership. 
 The right hon. Gentleman spoke also about centralisation and the role of local government. He said that care trusts represent centralisation. I remind him that clause 45 is about voluntary agreements between local authorities and the local NHS, and establishing closer working relationships. His argument is not credible. These are partnership arrangements under which a voluntary agreement is entered into by both parties. The Government reject the Opposition's criticism. 
 Another factor is the wider role of local government. The Opposition seem to regard health trusts as a diminution of local government, and they question local accountability for social services. I reject that view comprehensively. We should celebrate the fact that the Bill creates significant new opportunities for local government to influence the future direction of the national health service. Liberal Democrat Members are always banging on about the so-called democratic deficit in the NHS; they should consider the proposals as a welcome step forward. We shall come to governance arrangements later, but whatever we decide about governance, the care trust model offers local government an important new role in the commissioning of health care services. 
 The right hon. Gentleman suggests that clause 45 will denude local authorities of that wider responsibility and of the ability to influence events locally. I have great respect for him, but he is wrong. That view takes no account of the wider role that we envisage for local government through the scrutiny committees. Moreover, it does not recognise that when local authority members join the boards under the governance arrangements for care trusts, they will be able to discuss the wider commissioning of health care services in their locality. That will not just be in the context of social services, because board members of a care trust will be more than local authority representatives concerned only with social services delivery, as the board will have commissioning responsibility across the range. That is a genuine enhancement rather than a stripping out of responsibilities for local councillors.

Paul Burstow: The Minister repeatedly said at the start of his response to the debate that the Bill made it clear that the arrangements were voluntary. However, the briefing document describes the provisions as another stage in the evolution of the arrangements for joint working. Evolution implies that the current situation and that established by the arrangements will change.
 Will the Minister give us more information as to how he envisages the proposal on care trusts will proceed? I am not asking how many care trusts there will be, and I am sure that he will not want to set targets. Is the proposal a central part of what the Government want to happen, or is it merely something that can happen?

John Hutton: With great respect to the hon. Gentleman, I am not sure that I can answer the question in that way. We have told local government and the NHS that they have two options and can decide which they want to develop. They may want to go down the clause 45 route of voluntary care trusts, or they may decide to develop closer arrangements under section 31 of the Health Act 1999.
 I made it clear earlier that we believed that the care trust option had a great deal to commend it. It has many attractions, as it will provide for the first time a coherent organisational structure in which the closer partnership arrangements can be delivered. In that sense, it represents evolution from the Health Act flexibilities, as it takes them a step further. 
 I am an evolutionist. I think that we all are, or we would not have ended up where we are. I do not think that the hon. Gentleman, I or anyone else in the Committee has a precise blueprint for the position of the NHS in 10 or 15 years.

Paul Burstow: I am grateful to the Minister for clarifying his position on the creation of care trusts, but will he make one final comment? Does he rule out the possibility, as an incentive to the establishment of care trusts, of using specific grants with the condition that they are available only to local authorities that enter into care trusts?

John Hutton: It is clear that any conditions attached to the use of special grants have to be consistent with primary legislation. What the hon. Gentleman suggests could not happen. We cannot use special grant resources outwith the framework of law agreed by the House and the Committee.
 We started the debate on the issue of consultation, and have now come full circle. I tried to make it clear that, as with existing NHS organisations, we will set out the national application and approval process for care trusts in guidance. Subsections (7) and (8) will clearly regulate the process whereby an application to establish a care trust will be made at local level to the Secretary of State under clause 45. We intend that the regulations will clearly set out the procedure for the consultation exercise. Therefore, there will be a proper consultation process for the establishment of care trusts, as is essential. Similar rules apply to every other NHS body, and there is no reason to disapply them to care trusts. 
 I end with a homily about the concept of care trusts, about which many hon. Members have raised concerns. The right hon. Member for North-West Hampshire appeared to see care trusts as a takeover of local authorities by the NHS, but that is not so. This is not a change for change's sake, either. It is not an organisational game of musical chairs to involve local authorities in the NHS. We are not making fundamental changes in the pattern of delivering services simply for the sake of it. We have considered the issues carefully. The NHS plan sets out a strong argument for developing the Health Act flexibilities and taking them a stage further. That is what we meant by the reference to evolution. 
 If we sort out the problems, establish the case for care trusts at a local level, establish the credibility of the organisation, evidenced by strong local support, deal with the issues of governance, which I am sure we shall, and resolve the issues of charging--the right hon. Gentleman made rather too much of that in his objections to the principles of care trusts--we can take things to another level and bring health and social services much closer together. That is what our constituents want. They are sometimes baffled and confused by the arbitrary lines that we have created through decisions taken by this House in previous Parliaments, which have left us with organisational divisions between health and social care services. We should never lose sight of the fact that we put those lines in place, so we can take them out. It is as simple as that.

Desmond Swayne: Despite what the Minister has said, my right hon. Friend the Member for North-West Hampshire did the Committee a service by reminding us of the history of these matters and drawing our attention to the problems. Notwithstanding those problems, as I sought to make clear on the first group of amendments, we want to give care trusts a fair wind. However, we want there to be proper evaluation before they are established, which is why we attach such great importance to the question of consultation.
 The Minister chided my right hon. Friend for drawing attention the problems that have to be faced, including the issue of charging. However, he himself said that there has to be a way round those problems. He is right. Part of the solution lies in the process of consultation that we have raised in the amendments. The Minister made clear the importance that he attaches to consultation, and he explained how the regulations will be drawn up in that respect. Therefore, I beg to ask leave to withdraw the amendment. 
 Amendment, by leave, withdrawn.

John Hutton: I beg to move amendment No. 318, in page 38, line 32, leave out subsection (4) and insert—
 `(4) Where a body is designated as a Care Trust under this section—
(a) its designation may be revoked by the relevant authority at any time—
(i) of the authority's own motion, and
(ii) after such consultation as the authority considers appropriate;
(b) if an application for the revocation of its designation is made to the relevant authority by one or more of the parties to the LA delegation arrangements, its designation shall be revoked by the relevant authority at the earliest time at which the authority considers it practicable to do so, having regard, in particular, to any steps that need to be taken in relation to those arrangements in connection with the revocation.'.

John Maxton: With this it will be convenient to take the following amendments: No. 311, in line 36, leave out
`of the authority's own motion'
 and insert 
`at the instigation of the authority'. 
No. 258, in line 37, at end insert— 
 `(4A) If following receipt of an application to revoke a designation made by a local authority which is party to the LA delegation arrangements, the relevant authority— 
 (a) refuses the application, and the local authority has within two years of the date of its application renewed the application; or 
 (b) otherwise fails to revoke the designation, 
 the relevant authority shall on the expiry of two years from the date of the original application revoke the designation.'.

John Hutton: In tabling the amendment, we have tried to respond to the perfectly reasonable concerns that have been expressed by local government interests about the nature and duration of voluntary care trusts under clause 45. It was never our intention that entering into a voluntary arrangement would be a once and for ever act of agreement between local authorities and the NHS. It was always intended that, in the absence of such agreement, the arrangements surrounding a care trust could be brought to an end sensibly and carefully so as not to compromise the integrity or ability of local health and social care services to deliver first class services for local people. The purpose of the amendment is to clarify the situation and to make our intentions crystal clear.
 If any party wishes to end an arrangement, that will happen at the earliest time practicable. That will allow some local flexibility to ensure that local arrangements are appropriately sorted out before the care trust arrangements are terminated. It is not intended to encourage local partners to switch in and out of arrangements, depending on how the mood takes them. Care trusts are not a quick fix, but require a level of commitment from all the parties. 
 Given the other amendments that have been tabled in the group, I hope that right hon. and hon. Members who have expressed concerns about that aspect of the Bill will feel that we have tried to meet them more than half way. In doing so, we have emphasised the fact that the arrangements are voluntary. If there is no longer a voluntary agreement between the parties for a care trust to exist, we need to take that into account, and we have done so. 
 Right hon. and hon. Members may also want to know why the amendment retains the power of the Secretary of State, by his own motion, to dissolve a voluntary arrangement. I am told that the hon. Member for New Forest, West may want to raise the matter. Essentially, the power simply allows us to adopt a consistent approach with respect to care trusts and other NHS bodies. I hope that all right hon. and hon. Members would accept that the Secretary of State needs a reserve power to ensure that health care services are provided effectively and appropriately. In the amendment, we are not proposing anything other than what is applicable to every other NHS body.

Desmond Swayne: The Minister raises the intriguing question of who told him what the hon. Member for New Forest, West may want to raise. I am not aware of having had any conversations about the matter.
 Amendment No. 311 is rendered redundant by the Government's amendment, although the latter retains the curious form of words about ``the authority's''—meaning the Secretary of State's—``own motion''. However, we shall not dwell on that. My right hon. Friend the Member for North-West Hampshire should take as a compliment the similarity between the wording of his amendment No. 258 and that of paragraph (b) of the Government's new subsection (4), in amendment No. 318. The Minister explained his intention to meet us half way. 
 On the assumption that we want to encourage local authorities to enter into care trust arrangements, the key point to be made about the amendments is that authorities are likely to be singularly reluctant to do so without an escape route. It is crucial to the success of the enterprise that the availability of an escape route should be explicit in the Bill. 
 Amendment agreed to.

Desmond Swayne: I beg to move amendment No. 312, in page 39, line 21, at end insert—
`( ) providing for the appointment of representatives of local authorities to Care Trusts.'.

John Maxton: With this it will be convenient to take the following amendments: No. 313, in page 39, line 24, at end insert—
`( ) for securing the effective delivery of services relating to the functions of the trust and in particular the health-related functions of the local authority through proper integration of the functions of the prescribed bodies.'.
 No. 261, in page 39, line 28, at end insert— 
`(e) requiring that the governance arrangements, including representation of local authorities on the Care Trust, and the structure and arrangements proposed for delivering services relating to all the functions of the trust and in particular the prescribed health related functions of the local authority will ensure the proper integration of the functions of the prescribed bodies.'.

Desmond Swayne: The intention behind amendments Nos. 312 and 313, which provide for further categories of regulations to be made, is fundamentally to strengthen the purpose for which care trusts are to be set up. A strong case can be made for local authority co-operation with the NHS in new arrangements to bring about improved services. However, the new bodies must reflect the strengths of the local government organisations.
 The Minister has attempted to reassure us, but he is aware of concern that what is proposed will be not so much a merger as a hostile takeover by the NHS. Reassurance is therefore needed, and we want it to be expressed in the Bill by provisions such as our amendments. Trusts must reflect the views of locally accountable representatives, together with the experience gained by professionals in many years of providing social services in a local authority setting. Local authority representation should be strengthened by the Bill, and it should be made clear that those authorities' strengths will continue profoundly to influence the functioning of trusts.

Paul Burstow: This group of amendments deals with some important issues relating to the Government's arrangements for care trusts. In the earlier debate on care trusts, I asked the Minister whether the Government intended to ensure, either through the Bill or through regulations, that patient groups, especially those for the elderly, were represented on the boards of care trusts. In addition, I hoped that the Minister would say more about the differences between care trust boards and primary care trust boards. If, as we have been assured, the intention is for the health service and local government to have equal standing on the new bodies, that must be reflected in the executive and non-executive governance arrangements of the new trusts.
 Unison makes useful points about the current configuration of the governance of PCTs. When we had debates on the establishment of PCTs in 1998-99, the Government made a welcome commitment to having a lay majority on such boards. Will the Minister establish whether there will be equality between health service and local government interests on the boards? Will there be clear arrangements to provide for the involvement of the voluntary sector and other non-governmental organisations on the boards? If so, will the arrangements for appointment be the same as those envisaged for patients forums and other such bodies. 
 In the earlier exchanges, I asked the Minister about arrangements for incentivising localities to consider care trusts, and he said that it would not be possible for specific grants to have conditions that were outwith the legislative framework of the Bill. However, the briefing note that was circulated to Committee members states that the Government are considering encouraging the formation of care trusts through ``pump-priming.'' Presumably that means pump-priming with cash. That sounds like a clear mechanism to incentivise. Will the Minister say what he has in mind in terms of pump-priming? During the last Parliament, when arrangements were made for schools to consider opting out from their local authorities, pump-priming was used to incentivise that shift.

Philip Hammond: As the hon. Gentleman is drawing a comparison, perhaps he will remind the Committee whether Labour Members took a favourable view of that at the time?

Paul Burstow: I am sure that the Minister will explain what the Labour party felt about the measure at the time. I merely draw a parallel between the two mechanisms, hoping that the Minister will clarify the difference between the mechanism that was used to promote opting out by schools and the mechanism that is intended to promote the transfer or the merger of health and social care through care trusts. I look forward to his response.

George Young: I would like to put to the Minister some points on governance that arise from amendment No. 312. Some helpful notes on governance were circulated yesterday. Paragraph 19 of those notes states:
 ``The Government is considering how all board members should be nominated and appointed, taking account of the role of the new independent appointments commission.'' 
I assume that the new independent appointments commission could not veto a local authority's nomination for representatives to a care trust, but that its role would apply only to other representatives. If the partnership is to be one of equals, as the Minister implied, the local authority ought to be able to nominate whom it wants. 
 Will the Minister clarify something fundamental to our debate on the composition of the new care trusts? Paragraph 7.9 of the NHS plan does not make it clear whether the trusts will be new bodies or primary care trusts with social services bolted on. It talks in terms of establishing 
``new single multi-purpose legal bodies to commission and be responsible for all local health and social care'', 
but goes on to state: 
 ``This will require changes to the governance arrangements for primary care trusts to ensure representation of health and social care partners.'' 
It is not clear whether we shall simply tack social services on to primary care trusts or set up a new body to do part, but not all, of what the PCTs do and a little bit of what local government does. 
 I would like the Minister to comment on governance arrangements. Does he envisage a board on which councillors and the Secretary of State's nominees would sit, with an executive body underneath that? Will he talk about the balance on each, and how the system might work in practice? How often will the board—the top tier—meet? Will any of its members also be on the executive board? We need a slightly clearer vision than we have at present as to the governance of the new trusts.

John Hutton: The amendments seek to provide for the appointment of local authority representatives to the boards of care trusts, and to ensure appropriate integration of local authority delegated functions in care trusts. Opposition Members should brace themselves, as they probably will not like what I am about to say. Those matters are already covered in subsections (7) and (8). I fully understand the concerns, but our regulation-making powers will deal with matters as they need to when voluntary care trusts are established under the clause.
 The matters will be dealt with in secondary legislation. There will be guidance as to the composition of care trust governance arrangements, which will need to be flexible to reflect the different functions of each care trust. I hope that Opposition Members will support the idea of flexibility in the arrangements. It would be a mistake to adopt a one-size fits-all straitjacket about governance arrangements for the new care trusts. 
 I say to the right hon. Gentleman and the hon. Member for New Forest, West that there must be fair and balanced representations on the boards of the care trusts, to take into account and reflect the local authority's input into the services that the care trust will deliver.

Philip Hammond: The Minister makes the important point that the one-size-fits-all approach tends not to work. A moment or two earlier, he told my right hon. Friend the Member for North-West Hampshire that the matters would not be dealt with in a transparent way that we could scrutinise, but under the secondary legislation to be made under subsections (7) and (8). Does the Minister therefore envisage that regulations might prescribe different regimes for different care trusts? Is he saying that there would be separate orders to establish different regimes for individual care trusts, or will a set of regulations apply across the board?

John Hutton: There will clearly have to be an order to bring a care trust into existence, and it will have to specify the governance arrangements for that specific care trust. Such issues are still being discussed, as the hon. Gentleman will know. We have all had briefings from the LGA and others on them. We are actively trying to find a sensible set of solutions to the issues of the governance arrangements, about which I know that there is some sensitivity. We are asking local authorities to take an important step forward in delivering integrated care services through the establishment of the care trusts. Naturally, we do not want any of the arrangements that we will eventually propose to act as a deterrent.
 The right hon. Member for North-West Hampshire and the hon. Member for New Forest, West were concerned that some aspects of the Bill would discourage the establishment of voluntary care trusts under clause 45. I hope that he will take it as read that the Government do not wish the Bill, or any part of it, to act as a deterrent to the establishment of care trusts, and we will try to find a fair and balanced way to ensure effective local authority representation on the boards of the care trusts. 
 The right hon. Gentleman asked whether the care trusts would be new bodies, and, of course, they would. They will be designated as care trusts and will have the wider role and function designated by that status, including social services functions.

George Young: Would those bodies be additional to the primary care trusts or would there be additional responsibilities for the existing primary care trusts? Are we looking at two NHS bodies or one?

John Hutton: We are looking at one body. We are not in favour of fragmentation. If the local partners want it, the primary care trust, under the arrangements in clause 45, can enter into a care trust with the local authority, and a care trust will be established. The primary care trust will be the building block and the foundation into which the local authority social services—or whatever body—will be incorporated. That is a sensible way of proceeding and it avoids the fragmentation that would arise if we took a different view.

Paul Burstow: I am grateful for that helpful clarification of how the new entities will come into existence. Can the Minister develop further how the issue of coterminosity will be addressed? At present, PCTs can overlap with social services authority areas. A PCT could provide services through a care trust using a local authority that did not cover the same local authority area. In that case, how would the Minister envisage a person navigating his or her way through the care system if he or she lived in one local authority area but received social services from another as a result of the care trust arrangements?

John Hutton: The hon. Gentleman will find an answer to his predicament in subsection (3) of clause 45.
 These issues before us have been wide-ranging. Hon. and right hon. Members have raised several concerns about important issues.

George Young: It would be helpful if the Minister could amplify the point further. That was the first time that I had heard a clear and explicit statement that a care trust is a primary care trust with additional functions added on. If that is the case, we should now address important governance arrangements. If this is to be a partnership of equals between the NHS and the local authority, and there is an established primary care trust—an NHS body—with a lot of people involved in it, how can there be equal representation of the local authority when a relatively small amount of money is being given to an existing body that already has many other responsibilities?

John Hutton: Let me correct the right hon. Gentleman. If he has read clause 45 carefully, as I know that he has, he will know that we are not talking just about primary care trusts. There is also the possibility of NHS trusts becoming the foundation from which the new care trusts will be constructed. The details of the Government's arrangements are still subject to consultation between the LGA and other interested parties. I know that the right hon. Gentleman wants me to announce today the exact proportion of local government representation and NHS representation on the board of each trust. I am not in a position to do that, as he well knows. I repeat, for his benefit and that of the Committee, that we want those arrangements to represent a fair and sensible balance between the interests that local government naturally have in these issues and the provision of NHS services by the care trusts. That will be the subject of ongoing discussions. I am sure that we will come to a sensible conclusion and that those arrangements will be reflected in the regulations and guidance.

Lorna Fitzsimons: Does my hon. Friend accept that some of us are slightly surprised by some of the lines of argument that we have heard? In my constituency, for many years, people involved in local government and the provision of social services and social care have argued for just this type of arrangement? They do not see it as a hostile takeover but as a seamless continuum of the way that they have operated with professionals in the area for many years.

Philip Hammond: The hon. Lady has coterminosity.

John Hutton: I agree with my hon. F. I hear the hon. Member for Runnymede and Weybridge chuntering on about coterminosity. He is a very good chunterer. Issues such as coterminosity are boundary issues, and I accept that they are complex. That is inevitable given the nature of the organisations with which we are dealing. We have tried to deal specifically with the point raised by the hon. Member for Sutton and Cheam about what will happen if the NHS responsibilities of the primary care trust are narrower than those of the local authority. It is clear from subsection (3) that that will not impede the delivery of social care services to a wider population than is currently served by the primary care trusts. That is a sensible solution.

Philip Hammond: I should like to explore further the line of argument that my right hon. Friend the Member for North-West Hampshire developed. Does the Minister foresee the possibility within these governance arrangements that local authority representatives might be involved at a different level, perhaps in a committee of the trust that will deal with the social services part of the function being discharged by the care trust, rather than at the main board level of the trust? After all, the trust will have much wider functions than the discharge of social care functions for which it will be responsible.

John Hutton: The right hon. Member for North-West Hampshire raised that point earlier, and I can say that we envisage that there will be an executive committee structure for the care trust and the supervisory board. We have made that clear on previous occasions. The exact composition of the executive committee will have to be discussed with the various interests that are speaking to us about such matters and we have made no final decisions.
 Let me repeat for the benefit of the Committee that there are difficulties. The right hon. Gentleman was right to say that concerns have been expressed by local government, and we are trying to respond to those concerns sensibly. It is all well and good to look at the problems, but there are solutions, too. If our objective is to find a closer way to integrate health and social care services, which is the right thing to do, I believe that those solutions are not beyond us. 
 There is a sensible way forward. Like my hon. Friend the Member for Rochdale (Lorna Fitzsimons), I detect a willingness on the part of local government to look carefully at the benefits that a care trust model will offer. For our part, we will make sure that the care trust option remains attractive, and we will look carefully at the governance arrangements. As we have done already today, we want to make sure that nothing in the Bill can act as a deterrent to local authorities and the NHS taking important steps forward. 
 The hon. Member for Sutton and Cheam asked a number of times about the resourcing aspects, which I tried to deal with earlier. We shall have to consider carefully how to incentivise and encourage the development of care trusts. The hon. Gentleman will be aware that, as part of the NHS plan, we announced details of a new social services performance fund in an effort to improve enhancements and services for older people. That is a top priority for the Government: we want better health and social care services for older people, and we rehearsed some of the arguments for that last night. We will look seriously at how we can use the performance funds to make services better for older people. However, that has to be done in a way that is consistent with primary legislation and does not impose obligations or requirements on local authorities that are not encompassed by the legislation that the House approves.

Paul Burstow: The Minister's last comments were helpful and will no doubt give rise to further questions and examination in due course. I am still puzzled about the issue of reconfiguring services around care trusts. That may not present insuperable problems, but it will undoubtedly cause some problems that will need to be surmounted. For example, let us say that a local authority such as the London borough of Sutton has a primary care group covering the bulk of its population—about 80 per cent. of it. If another primary care trust covering the population of another local authority covers 20 per cent. of Sutton's population, Sutton will have to enter into a voluntary arrangement with that local authority—the London borough of Merton, perhaps—to provide a care trust. Merton will presumably be providing social care services for at least 20 per cent. of the population of Sutton. If that is so, how will those local authorities be funded?
 Under the SSA methodology, which is a demographically driven number formula, money will be sent to the local authority to provide for the needs of its community. Yet part of that community will have its meets met by another local authority and that, too, will be formula-funded under the SSA. How will that be unpicked? Will the money that goes to provide social care go with the individual to the care trust? In other words, will arrangements be needed to facilitate such a transfer of resources? I hope that the Minister will say a little more about those matters, because a lot of detail remains to be exposed.

Desmond Swayne: I certainly want to hear the answers to those questions. I hope that we will hear them during the stand part debate, because a number of other questions have not yet been answered. In seeking to include in the Bill our requirements for local authority representation, we intended only to probe. The Minister says, with some justice, that those matters are dealt with in subsections (7) and (8). Yes, they are, but we want to know how.
 The result of our probing was not what we expected. In one respect, it was a pointless exercise, because the probe hit a blancmange—[Laughter.] Hon. Members may laugh, but that is the correct analogy. The Minister said that flexibility was needed; he certainly has it. He has absolute flexibility because he has not told us anything. Instead, we have to rely entirely on his assurance of a proper and fair balance of representation. We wanted to the Minister to tell us where that balance was to be found, but he was not prepared to tell us. In that respect, we have not been able to probe effectively. However, under the intense and perceptive scrutiny of my right hon. Friend the Member for North-West Hampshire, we have been told something of the nature of trusts, particularly of primary care trusts. 
 We shall certainly wish to think about that and look at the record before returning to the subject, but I beg to ask leave to withdraw the amendment. 
 Amendment, by leave, withdrawn. 
 Question proposed, That the clause, as amended, stand part of the Bill.

George Young: One or two issues are appropriately raised now, including some questions asked earlier that have not been answered. For example, I asked the Minister whether the independent appointments commission or the Secretary of State will be able to veto nominations to care trusts made by local authorities. I hope that he will confirm that local authorities can nominate whom they want to represent them, and that the Secretary of State will not have a veto, as was implied.
 It has been a helpful debate, and I am now a lot clearer about what is proposed—although I am slightly more worried. The Minister argued that the arrangement is voluntary and that no one has to enter into it, and that it is not a takeover, but will be on the basis of equality. Many arrangements are, in theory, voluntary, but the Government nudge local authorities to enter into them, so they become almost compulsory. For example, the takeover of housing stock is in theory voluntary, but local authorities know that they will not receive the capital they need to modernise their housing stock if it stays in their control. The only way for them to go is the voluntary transfer route. Local authorities can say that that is voluntary, but it is the only way they can provide the services that tenants need. 
 We have not touched on a real resource problem, which is that the increase in resources for the NHS has been far larger than the increase to social services, and as a result many directors of social services are looking with some envy at the NHS budget. They are considering the problems confronting them; they are blamed for bed-blocking because they are not making placements in nursing and residential homes. Many of them see care trusts as the way out: as a way to access the limitless resources of the NHS and free themselves from the constraints of local authority budgets. When the Minister says, ``Yes, the arrangement is voluntary,'' he is right in one sense, but many directors of social services know that unless they enter into these agreement, they will be unable to access the resources necessary to deliver a quality service. 
 What matters is good working relationships on the ground, which we already have with the practice of pooled budgets and lead commissioning. That is the way forward. Having listened to the debate on clause 45, I urge caution before proceeding down that road at any great speed. The Minister's response made it clear that many key issues have not been resolved. 
 The Minister says that these arrangements are not a takeover. However, local authority social services functions will be bolted on to a primary care trust. It is like badge engineering--it is the same vehicle, but it will be called something different and have a few additional functions. How can the Minister present this measure to local government as a partnership of equals when he has given no assurances about the balance of representation? The Minister will come under increasing pressure from local government, which will see it as a slightly different animal than the one they read about in the NHS plan. If the Minister goes down that path, I urge him not to steam ahead at great speed, but to take local government with him. He should consider some of the issues raised in this helpful debate, and realise that, in fairness to the Committee, the Government have not been able to address some of the real issues as fully as they would have liked.

Peter Brand: It has been a useful debate. The right hon. Member for North-West Hampshire expressed his anxieties, and my hon. Friend the Member for Sutton and Cheam made perceptive points, which dealt with the position of local government and governance of the proposed care trusts. To pick up the analogy just used, I am sure that the Government are travelling in the right direction, although I warn the Minister that it will not necessarily be plain sailing.
 When the Select Committee on Health looked into the relationship between health and social services, we found some excellent examples of joint working all round the country. In Northern Ireland, joint working was enabled by a structure that brought the two authorities together. Curiously, in only about a fifth of Northern Ireland were services integrated even though it has had a joint statutory body looking after health and social services since 1948. That shows the need for the Government to take the people that deliver the service and the community that benefits from it with them when they create such patterns. 
 We should not be talking of a takeover, but of a merger of cultures. We should not underestimate the difficulties that go with that. We need to evolve a common language. Social work language can be quite different from medical language. More joint training early in people's careers is needed. Although care trusts look like an attractive short cut to joint working, it will be a challenge to make that happen. 
 We also saw good examples in Scotland of successful integrated work—at times using methods that I shall describe as extra-statutory. Flexible arrangements were made locally, and when we challenged the commissioners on how it was possible to get away with them under present regulations, they replied, ``We ring the Minister in Edinburgh and sort something out.'' That shows what flexibility is needed to make local schemes work. 
 We also saw good joint working in Rochdale, but there is good joint working between health and social services at patient-client level all over the country. However, that often comes about as both sides of the joint team abandon some of their own rules and regulations, and set aside some of the local statutory regulations on, for instance, charging. We saw many examples of excellent mental health work with one integrated team. It was not possible to tell from the functions of team members whether they worked for social services or for a health authority. Clearly, different charging policies for members of one integrated team would have been nonsense. 
 The Government are dismissing too lightly the issue of charges and the culture associated with them. No doubt we shall return to that point on clause 48. The schemes that the Health Committee examined were all promoted, and all worked, because the people who worked in them adopted an extremely flexible approach to the statutory charges that were levied by bodies in the locality that were not involved in an integrated scheme. 
 I am disappointed that we have not, in considering the clause, touched on the importance of a clear commissioning and provider function. I know that it is sometimes thought a bit messy for both PCGs and PCTs—and now no doubt care trusts—to be providers and sub-commissioners of secondary and other services. However, the Minister has not explained clearly the proposed role of health improvement programmes, any relevant condition for joining a care trust, or an integrated planning function. 
 There are many issues concerning democratic accountability: the relevant input is important with respect to the governance of the care trust, but it is even more important with respect to the workings of the commissioning bodies, which, for a care trust, will still be one or more local authorities, and the health authority to which the care trust is responsible. It would be helpful if the Minister would describe more clearly how democratic accountability will be guaranteed on the commissioning side. We should have a structure for overcoming some of the practical local problems concerning lead authorities and shared social services provision, which were pointed out by my hon. Friend the Member for Sutton and Cheam.

Desmond Swayne: In discussing the previous group of amendments we tried to probe the question of who would be on the boards of care trusts, and how those boards would differ from those of existing trusts, such as primary care trusts. I should like to use this brief debate on clause stand part to probe the Minister further. He has assured us that the partnership will be genuine. If we take that assurance at face value, it begs several questions. For example, how will the partnership affect the local authority scrutiny function? If the partnership is genuine, the local authority will have acquired an interest in the trust. How, therefore, can its own independent scrutiny function continue to work effectively? How are the trusts linked to patients forums?
 What about performance indicators? Will we develop new ones, tailor-made for care trusts, or will we apply the performance indicators that we have traditionally applied to local authorities or to NHS bodies? What happens when things go wrong? What will the complaints procedure be? Will complaints against the care trust ultimately be dealt with by the local government ombudsman, or by the NHS ombudsman? 
 The hon. Member for Sutton and Cheam asked some pertinent questions about financing and local authority boundaries. We require an answer on that. The question of how such things will work is not just constitutional and academic, although the discussion is interesting. The issues will have a real impact on the patients at the end of the line. 
 If a local authority enters into a care trust arrangement, will its social services committee continue to take policy decisions in the same way that it does currently? The hon. Member for Sutton and Cheam raised the question of charging in that respect. There is a fear that in future, existing NHS services will be repackaged as social care services, so that they can be charged for. We will be seeking some reassurance on the issue of respite care, which is currently provided by the NHS. If in future respite care is provided under social care provisions by a care trust, will the existing dispensation continue? Will there continue to be no charge for that care? It would be quite wrong if, in the new world of care trusts, people ended up being charged for a service that they currently get free of charge. 
 There is a series of pressing questions on the nature of the organisations, the way in which they are to be set up and the way in which they will work. The Minister says, ``We still have to think some of those problems through.'' However, all the questions have profound practical implications, which are bread and butter issues for the people who will receive the services at the end of the line.

Paul Burstow: The right hon. and hon. Members who have contributed to the debate have already posed several of the questions that have arisen. If the Government have not yet come to any final conclusions, such questioning helps to tease things out a little further.
 Several questions arise from my own experience of the configuration of primary trusts, primary care groups and local social services departments. How will the issue of overlapping boundaries between the agencies be dealt with? Who commissions the social care services in areas where a care trust covers part of the population for one social services department and the majority of the population for another? Does the authority in which the person resides commission that service or does the authority that is providing the service commission it? Or does that function fall to the care trust, as a way of bridging the gap? 
 Who provides the care? If a care trust is based upon a local authority, but also operates in another local authority area, is the care package that it provides, which includes elements of social care, delivered by the local authority that has joined into the care trust or by the local authority that just happens to have the care trust operating on its patch but is not part of it? Who provides the care? In my constituency would it be the home care workers working for the London borough of Sutton, or would it be provided by those working for the London borough of Merton, which is part of the care trust? 
 Who pays for the service? Does the London borough of Sutton pay for the service and passports the money through to the London borough of Merton to pay into the care trust, or is the money mysteriously magicked away through the wonders of SSAs and rolled up into the grants that go to the care trusts? 
 Who sets the charging policy? If my constituent is provided services by a care trust which includes social care that is provided by the London borough of Merton, are the eligibility criteria and charging policies that apply those of the London borough of Merton or those of the London borough of Sutton? 
 Who monitors the service at a national level? Will it be the social services inspectorate or the Commission for Health Improvement or a joint arrangement? How will that work? 
 What are the issues around probity? The methods of guaranteeing probity between a managed service such as the NHS and local authorities are different. Where does the district auditor fit into scrutinising the accounts of the NHS bodies that are spending local authority-derived funds? 
 Finally, the hon. Member for New Forest, West described the arrangements for scrutiny by local authorities. Which local overview scrutiny committee would scrutinise the services—would it be that of the London borough of Sutton or that of the London borough of Merton? Where do my constituents go if they wish to raise concerns? I am sure that we will be told that their first point of call will be a patients forum, but if they have wider issues to raise, will they go to the London borough of Merton or will they have to come back to their Member of Parliament because he is the only person who could possibly help them navigate the systems that are being set up? 
 During our consideration of the proposed amendments to the clause various questions were asked and the Minister graciously answered quite a few of them. However, one or two still have not been addressed. I have asked twice so far today whether the Government's arrangements will specifically include older people. It would be useful to know whether, in principle, the Minister accepts the case for such inclusion. 
 The legislation governing social services has evolved through case law. There is a great wealth of case law now determines a good deal of practice in social services departments. The NHS, however, tends to be driven by guidance. It would be useful if the Minister could tell us where and how the line will be drawn. How will case law that has already developed—and no doubt will develop in future—affecting the operation and delivery of social services impinge upon the operation of NHS bodies within the framework to be put in place by the legislation? 
 My final question is again one that I asked earlier, but to which I have had no answer. It relates to the need to ensure that carers and service users are included in the arrangements for assessment and are entitled to separate assessments. As the Minister knows, that is established through the Carers and Disabled Children Act 2000. How will it apply within a care trust? Will it apply, as now, within the context of that statute, or will there be new arrangements? Many carers who supported that private Member's Bill would like to have clarity on that at the earliest opportunity.

John Hutton: We have had a full debate on clause 45. I have been described as a blancmange by the hon. Member for New Forest, West, and that is certainly a first.

Desmond Swayne: I was referring to the Bill.

John Hutton: With respect, I believe that he was describing me as a blancmange. That is certainly how it struck me and I am not altogether sure whether it is a flattering observation. I shall need to consult my learned friends on that and no doubt return to the matter later.
 Generally, however, I am grateful for the clause's reception, which has at times been positive. I am also anxious to dispel some of the lingering doubts that Opposition Members have expressed. The leading doubter is the right hon. Member for North-West Hampshire, who knows about the subject from when he was a Minister, and obviously remains a sceptic about care trusts. 
 Labour Members subscribe to conspiracy theories on a routine basis. It seems as though that virus has infected the right hon. Gentleman where care trusts are concerned. Let me say in all candour that there is no hidden agenda about financial issues or charging responsibilities in relation to social care services. Care trusts are not a short cut. There are no quick fixes to the policy that we are pursuing, which is the closer integration of health and social care. 
 As usual, the hon. Member for Isle of Wight displayed common sense when he talked about the different cultures of the organisations, which we know exist. I strongly believe that sensible solutions are at hand to facilitate the success of care trust organisations. We have scrupulously tried to ensure that the proposals in the Bill put those in the NHS plan into effect. The right hon. Member for North-West Hampshire tried to imply that the proposals in the Bill were somehow different from those in the NHS plan, but that is not the case. We set out the strategy in the NHS plan, and the Bill provides the technical means whereby the care trusts can come into existence. 
 I assure the right hon. Gentleman, and the hon. Members for Sutton and Cheam and for Isle of Wight, that care trusts are not a vehicle for extending charges. We have heard the mantra that establishing a care trust is some cloak-and-dagger operation to allow the NHS to charge for its services, but Opposition Members should get real. As a Government, we have made it repeatedly clear that we will not extend charges for NHS services. That may be the agenda of the Conservative party; it may even be the agenda of the Liberal Democrats, but it is not our agenda. That argument is bogus and false.

Peter Brand: My concern was not that the Minister might extend charges; I would not be so uncharitable. I warned that the existence of charges as at present in social services militates against the joint working relationships that we are so keen to see. That was clearly one of the findings of the Select Committee on Health.

John Hutton: I do not accept that, as I have made clear. The last occasion on which I did so was in the House last night. The issue of charging has been raised, but it has been a feature of social care delivery in this country since 1948. I accept that we have not achieved all that we have wanted in terms of closer working between the NHS and social care services since 1948, but to attribute that largely to the issue of charging for social care services is to misread the situation.
 We must address organisational issues, and the care trusts will help us to do that. We could hide in our bunkers, as I suspect that the Liberal Democrats are doing, and say that charging makes it impossible for health and social care services to work effectively together. That is essentially what the hon. Member for Isle of Wight just said, as he said that it impeded effective working. However, that is a false analysis and is not borne out in reality.

Philip Hammond: Perhaps rather predictably, I am rising in response to the Minister's provocation, and I suspect that it may not be for the last time today. As he knows full well, the policy of the official Opposition is that we have ruled out any extension of NHS charges.

John Hutton: Well, there we are. We all feel reassured about that. I hope that the hon. Gentleman will not mind the fact that I am glad to say that the matter remains academic, given that, rather obviously, he will not be in a position to have any bearing on the future of the national health service. Those who saw how the Conservative party managed the affairs of the national health service are entitled to take everything that the hon. Gentleman and his right hon. and hon. Friends say with a heavy dose of salt.

Philip Hammond: On a point of order, Mr. Maxton. I hope the Minister is not suggesting that in making that statement I sought to mislead the Committee or that it was not a true statement made in good faith.

John Maxton: That is not a point of order.

John Hutton: I am genuinely sorry to have upset the hon. Gentleman.

Philip Hammond: There will be more of that.

John Hutton: Yes, perhaps there will, because many Labour Members have longer memories than the hon. Gentleman and remember the contribution that he and his party made to the history of the national health service. I do not think that any Labour Member would be other than horrified at the prospect of he and his right hon. and hon. Friends having jurisdiction over the national health service in future. Indeed, I think that that would apply to anybody in the country as we know exactly what the Tories think about the national health service. It is clear from their actions and their words that they do not believe in it. However, that is a wider topic.

Philip Hammond: I am sorry to waste the Committee's time, but if the Minister insists on placing on the record statements that he knows to be false, I am forced to correct him. My right hon. Friend the Member for Richmond (Mr. Hague) and my hon. Friend the Member for Woodspring (Dr. Fox) have repeatedly reasserted the Conservative party's commitment to a universal national health service free at the point of use. The Minister knows that well. It is not an effective use of the Committee's time to repeat those old slurs.

John Maxton: Order. It would be for the benefit of the Committee if we returned to debate the clause.

John Hutton: I am happy to debate the clause.
 A number of final issues were raised, particularly by the hon. Member for Sutton and Cheam. He spoke of coterminosity. I drew his attention to clause 25(3) that deals in part with one of his concerns. 
 The hon. Gentleman also raised the slightly different issue of how a care trust would provide social services functions to a group of patients on the list of a GP covered by the PCT, but outside the local authority area. I am sure that the hon. Gentleman understands that a care trust cannot provide social services functions that have not been delegated to it by a local authority. So if some of his constituents are on the list of a GP, but not within the local authority boundary, unless their local authority is also party to the care trust, the trust will not be in a position to deliver or assume responsibility for social services functions in respect of those people.

Peter Brand: Would it be possible to have an ad hoc arrangement for a small group of clients of a local authority to have their services provided by a care trust even though the local authority is not a signed up member of the trust?

John Hutton: I do not think that that will be possible. I will look at the issue in detail and advise the hon. Gentleman and the Committee.
 We have had a long debate and I sense that Committee members are keen to move on to other parts of the Bill. Having heard the doubts that they have expressed about the clause, perhaps right hon. and hon. Members should ask themselves one fundamental question: is it right to pursue closer integration between health and social care services under the umbrella of a new organisation that will have a fair and balanced representation of local authority interests and will lead to better front-line services for those who use the NHS and social services? In the first instance, older people may well be the principle beneficiaries of care trusts, but other client groups can benefit too, particularly people who suffer from mental health problems. We have to ask ourselves whether we believe that it is right to develop a new framework within which health and social services are more closely integrated? I believe that we should answer yes. 
 Question put and agreed to. 
 Clause 45, as amended, ordered to stand part of the Bill.

Clause 46 - Care Trusts where directedpartnership arrangements

George Young: I beg to move amendment No.260, in
page 40, line 9, leave out `any of'.

John Maxton: With this, we may take amendment No. 259, in
page 40, line 18, at end insert—
 `( ) Regulations shall make provision—
(a) prescribing the criteria by which an authority will be deemed to have failed in relation to its functions;
(b) prescribing arrangements for consultation with the failing body and other relevant interests;
(c) prescribing the circumstances and procedures to ensure that wherever appropriate the failing body has the opportunity to remedy any failure to properly exercise any of the relevant functions;
(d) providing for a right of appeal to a court by the failing body as to the law or any finding of fact by the relevant authority against the authority's judgment that a local authority has failed in its provision of relevant services.'.

George Young: We now move to clause 46 where, once again, the Minister will have to find some fresh vocabulary to explain why we are proceeding with care trusts. We have heard a great deal about voluntary arrangements, no compulsion and equal partners. That may well have been valid for clause 45, but it is not valid for clause 46, which provides that the Secretary of State can move in and impose a care trust. So we can now say goodbye to Mr. Hyde and hello to Dr. Jekyll because this is perceived as a punishment. It is difficult to see how a care trust can be both a reward for good behaviour and a punishment for bad behaviour. All we know about clause 46 and the circumstances in which it will be invoked is first, that the authorities involved did not want to enter into an arrangement voluntarily, and secondly, that something has gone wrong. Against that background of an unwillingness to work together and something going wrong, it seems heroic for the Secretary of State to move in and impose a new arrangement that is as yet untried, and about which we have had a full debate.
 The import of amendment No. 260 is to narrow the circumstances in which the Secretary of State can intervene by deleting the words ``any of''. The current wording of the Bill suggests that if a local authority failed to exercise any of its health related social service functions adequately, the Secretary of State could move in and impose a care trust structure. Such a direction could result from a difficulty with a single aspect of an individual service. This is very draconian given that there is no requirement on the Secretary of State to give the authority the opportunity to remedy the problem. I hope that the Secretary of State will agree that the clause 46 solution should be applied only when everything else has failed and attempts have been made to solve the problem is in more conciliatory ways than by the imposition of a care trust. The Minister could begin to allay some of the concerns about clause 46 if he indicated the circumstances in which the functions had failed, whether the evidence that substantiated that view would be in the public domain, and whether it would have to be underpinned by independent professional opinion. 
 It might help inform the rest of our debate on clause 46 if, in his response to amendment No. 260, the Minister could say a little more about what might trigger such a draconian remedy with all the consequences for local democratic accountability that would flow from it.

Paul Burstow: I have just a couple of questions to add to those of the right hon. Gentleman. The briefing note that has been circulated quite rightly says:
 ``The Secretary of State will need a good reason to recommend the formation of a care trust or a flexibility. What is important is that the intervention power is evenly balanced.'' 
The right hon. Gentleman's amendment would set out in the Bill a procedure whereby the Minister will have to operate in an open and transparent way in setting out the grounds on which a failure is identified and what that failure is. It would provide an important safeguard in the exercise of the Secretary of State's power. I hope that the Minister will accept the amendment or something similar and recognise that transferring a service into a care trust or a flexibility ought not to resemble the use of a sledgehammer to crack a nut. If a particular service is failing, there might be a case for some of the measures contained in clause 46, but no need to transfer all the other services that may well be part of that local authority's social services department. It would be useful to have some clarity about how this power will be used. 
 Perhaps the Minister could also add a little detail to the reference in paragraph 36 of the briefing note to the proposal to have an arbitrator who could be brought in to determine the appropriate level of delegated functions. Who would be the arbitrator? Who would appoint him or her? What mechanisms will be in place to ensure that the local authority and the health service are satisfied with that? How will that person will be appointed? Those are important questions in understanding how the power under clause 46 will be used. I hope that the Minister will be able to give us some reassurances that the underlying methodology and the practice will be open, transparent and able to be checked by all involved.

Philip Hammond: As my right hon. Friend said, clause 46 raises quite different and important issues and I give the Committee notice that we shall be seeking to oppose it on stand part. In anticipation that the Government will resist that move, we have also tabled amendments to improve the clause and minimise its negative impact. At this stage I wish to associate myself with my right hon. Friend's amendments. They are a clear attempt to improve the transparency of the arrangement proposed under clause 46 and to reduce the arbitrariness of the Secretary of State's apparent power. Although we shall oppose the clause on stand part, I wish my right hon. Friend's amendments a fair wind as they are a valid attempt to improve what is a seriously flawed clause.

John Hutton: It may be helpful to the Committee if we start our discussion about the amendment with a few observations about the structure and nature of the clause. As the right hon. Member for North-West Hampshire will be aware, subsections (1), (2) and (3) of clause 46 are about directed partnership arrangements and subsection (4) is about the step that the Secretary of State might want to take to establish a compulsory care trust. The problem that we are trying to address, which is the failure to deliver an adequate level of service, can be addressed in one of two ways: either by a directed partnership arrangement under the Health Act 1999 or, if the Secretary of State so wishes, by the establishment of a compulsory care trust.
 The right hon. Gentleman will have had an opportunity to read the Government's briefing note in which we try to put some flesh on the bones of our thinking on the clause. We make very clear the circumstances in which we would expect to take steps to establish a compulsory care trust. We use the expression that it would be established ``as a last resort''. I hope that that is an important clarification for the right hon. Gentleman. 
 The hon. Member for Runnymede and Weybridge talked about the arbitrary nature of the powers in clause 46 and expressed his concern that they could be used arbitrarily by the Secretary of State. That is not the case. We have debated similar issues on many occasions and he will be aware that the Secretary of State is not allowed to act arbitrarily. There is a framework of public law and general principles of law that makes the method by which the Secretary of State is expected to reach such decisions and conclusions quite clear. There is no suggestion, either in the Bill or in what Ministers or the Government have said in the NHS plan, that those general principles—the need to act fairly on the basis of evidence, and so on—will in any way be supplanted by what is proposed in clause 46. 
 It is very important, for my hon. Friends at least, that the Committee should understand that this is not—to use the expression of the hon. Member for Sutton and Cheam—using a sledgehammer to crack a nut. I ask hon. and right hon. Members to ask themselves why would we want to do that? We clearly would not. We want to develop the policy about care trusts in a sensible and reasonable fashion. 
 The right hon. Member for North-West Hampshire asked me to change my vocabulary and I am trying to do so. Let me reassure him, too, that this is not a smoke and mirrors operation whereby we shall effectively be able to use clause 46 to establish care trusts compulsorily across the country. If the hon. Member for Runnymede and Weybridge had looked at the Bill carefully he would know the answer to that question. He might want for his own reasons to be seen to be opposing clause 46; but I can reassure him that the clause has nothing whatever to do with any suggestion that the Government's policy is to use the provision universally to require the establishment of care trusts. That could not be done because, notwithstanding the Opposition's amendments, a clear set of preconditions needs to be established before the Secretary of State can use those powers; and those preconditions would have to be complied with to the letter before he could act. 
 The purpose of clause 46 is to ensure that the Secretary of State can intervene if service users are being failed, and if the integration of NHS and social service functions would improve the outcome for them. The Secretary of State needs to be able to act, and the words ``any of'' are important in allowing us to target that intervention to the benefit of the user. 
 The aim of social services is to provide a package of care to support older people and enable them to live independently within the community. If one element of that package—perhaps the home help service—fails to deliver the appropriate high-quality service, and if social services fail to monitor and review that provision, those people could be at risk and their ability to live at home compromised. If it becomes clear that it is not a one-off problem but a consistent failure of function, it would be the Government's duty to intervene. It would be sensible to use the intervention power in relation to that failing service. We need to be able to target the direction power, and we can add other functions if necessary. 
 The amendment would not limit the breadth of the new power. For local authorities, clause 46(3) limits intervention to a failure in social services. However, the words ``any of'' serve a crucial purpose. They make it clear that the Secretary of State can intervene when there is a failure of any health or social services function. Removing those words would cast doubt on that power, and might limit the intervention to cases of failure in all of a local authority's social services functions, or all of a primary care trust's health functions. 
 We are not using a sledgehammer to crack a nut. We shall be specific. We need to ensure that the package that is delegated is capable of being improved, and that it is not put at a disadvantage by being isolated from related services. That point is covered in subsection (2), which we seek to clarify with an amendment that I hope will have the support of the right hon. Member for North-West Hampshire. 
 Finally, I turn to the functions of the NHS and social services as set out in the partnership arrangements under the Health Act 1999. Amendment No. 259 attempts to build a detailed package around the need to intervene when services are failing. The right hon. Gentleman probably knows that we already have appropriate mechanisms to identify failure. They include performance management, monitoring, inspections and reviews. Those mechanisms will provide evidence to show when it is appropriate to use those powers. The usual process of enabling a body to improve its services through special measures will be allowed; but the direct use of the power may be required. 
 Clearly, if patient or client safety is an immediate problem, action may need to be taken more swiftly. It is not necessary to construct a new set of arrangements and begin the proliferation of new processes of review. The powers are intended to build on what already exists and not to replace other models of intervention. They are designed to give us the additional and valuable option to direct the use of the partnership arrangements. We shall therefore act if there is evidence of failure, using existing mechanisms to allow us to come to a decision, and we shall act in a reasonable manner. When intervening, we shall consider the best options to improve services for the benefit of all our constituents.

George Young: I am grateful to the Minister for dealing with some of my concerns. I take it that intervention will be a last rather than a first resort. He listed several procedures and special measures, but they would not necessarily provide a swift solution. My residual concern is about transparency and fairness to the local authority. Will he give an assurance that the reasons for his intervention will be put into the public domain, that the local authority will have an opportunity to respond to them and that, if possible, his concerns will be backed up by impartial, independent, professional opinion, so that it is not just his view or that of his Department? If that were the case, we might be able to cope without the regulations.
 We need an assurance that the Minister would not merely say to the local authority, ``I'm sorry, but there has been an awful case in the papers. I want to use my powers of intervention'', and that there would be all the due process of equity, transparency and fairness. There should be an opportunity to respond, and the measure should be used only as a last resort when everything else has failed. If the Minister can give that assurance—in his own words rather than mine—it would allay some of the concern behind amendment No. 259.

John Hutton: To cut a long story short, I can give the right hon. Gentleman those assurances.

Peter Brand: I support the points being made. I draw the Minister's attention to the debate on the Food Standards Agency. It was recognised that the Secretary of State needed to have the power to withdraw a function if it was deliberately not carried out effectively. In that case, there was a prescribed process, which provided the checks and balances mentioned by the right hon. Member for North-West Hampshire, including an appeal mechanism. The agency took the step and the Secretary of State was the formal appeal mechanism.

Philip Hammond: The hon. Gentleman has used the example of the Food Standards Agency legislation. This legislation is slightly different, because the Secretary of State would not be withdrawing a power that was originally his and that he had delegated, but would be intervening and taking a power that currently belongs to the local authority.

Peter Brand: That is an interesting observation. I disagree with the hon. Gentleman, because environmental health is a local authority direct function, just as the delivery of social services and some of the health provision is a direct function of local authorities. Serious checks and balances should be in place before the Secretary of State has the ability to override a locally elected, democratic body. That is why I share the right hon. Gentleman's concern. I hope that the Minister will flesh out the checks and balances and the opportunities for a local authority to make a clear case when a disagreement on policy arises between the Secretary of State and a locally elected body.

George Young: I beg to ask leave to withdraw the amendment.
 Amendment, by leave, withdrawn.

Philip Hammond: I beg to move amendment No. 305, in page 40, line 9, leave out `and' and insert--
`it shall notify all statutory patient representative bodies at the time in existence within the area covered by the body of its intention to make a direction under this section and shall invite representations regarding the proposed direction from them and, having taken such representations into account.'.

John Maxton: With this it will be convenient to take the following: Amendment No. 292, in page 40, line 16, at beginning insert--
`and has consulted with and it is supported by the Patients Forum and other relevant statutory and voluntary bodies in the relevant area'.
 Amendment No. 297, in page 40, line 18, at end insert— 
 `(1A) The relevant authority may exercise this power only after taking full account of the conclusions of a best value review'.

Philip Hammond: The amendments would require the relevant authority to take into account the views of the appropriate statutory representative bodies in the area affected. The Minister talked at length about the voluntary nature of the arrangements between local authorities and health bodies under clause 45. We have some doubts about how the arrangements will work, but as long as they are voluntary, we will watch with interest and hope that they succeed.
 Clause 46 provides the power to force the arrangements into existence against the will of either of the parties. Many people will question the workability of compulsory care trusts or directed partnership arrangements. I think that the Minister would accept that the concept of a directed partnership is internally contradictory: either people work together in a partnership or they do not. It will be especially important that we scrutinise the circumstances and the situation in which arrangements are made by direction of the Secretary of State under the clause. 
 The one justification that the Minister has put forward, which on the face of it is valid, is that this provision is about delivering services to service users. When the services fail, the service user must be protected. The Minister claims that it is not a matter of protecting the ego or the self-importance of any particular body, but of ensuring that the services are delivered effectively and efficiently. Surely, if the Government are abolishing one set of statutory patient representative mechanisms and putting in place another set, there should be an explicit requirement in the clause for consultation with whatever statutory representative bodies are in place when the clause comes into effect. 
 Amendment No. 305 has been deliberately phrased to accommodate the fact that we do not know the timescale for the coming into force of the different parts of the Bill. It is possible that the community health councils will be the statutory representative bodies when this part of the Bill comes into force, and will subsequently be replaced by patients forums and the other mechanisms that the Bill introduces. 
 Serious issues will arise if the Secretary of State uses his powers to direct a local authority to surrender its powers to him. The justification for the use of such powers will be the failure to deliver adequate services locally, and it will have to be a stark and obvious failure. If the statutory patient representative bodies are to have any meaningful function, they must be involved under such circumstances. 
 The Minister will no doubt say that there are powers in the Bill to make regulations specifying how things are to be done. He will no doubt assure us that those regulations will include arrangements for consultation. Later, I will say something about the Minister's assurances, and how much value we may attribute to them. Clause 46 allows for the compulsory transfer of power from one body to another at the instigation of the Secretary of State, on the grounds that patients' interests are seriously affected. I hope that the Minister accepts that there should be an explicit requirement in the Bill for consultation with statutory bodies of patients' representatives before any such transfer occurs.

Paul Burstow: Amendment No. 297 is designed to probe the Minister on the role of local authority best value in establishing whether or not a service is failing, which could trigger the exercise of the powers in the clause. When will a best value regime be introduced into the NHS? I understand that guidance on best value in the NHS is being produced. It would be useful to know when it will be published. Clearly, the closer the two regimes are, the better they can be married together in the context of a care trust. It would be useful if the Minister could say something about that, and if he could deal with the question that I posed earlier concerning the arbiter. Will he say more about who will appoint the arbiter, and what the arbiter's role will be? What powers will he or she have to resolve the question of what functions are transferred?

John Hutton: Amendments Nos. 292 and 305 would require consultation with statutory local patient representatives before either the Secretary of State or the National Assembly for Wales made an order for a care trust to be established. Amendment No. 297, tabled by the Liberal Democrats, concerns the duty to require a best value review before making a direction to use a partnership arrangement.
 If the hon. Member for Runnymede and Weybridge carries on like this, he will make my job much easier for me. If he anticipates my response, perhaps I do not actually have to make it. That would save us all a lot of time. He rather ungraciously thought that he should question my assurances on the clause before he had heard them. That was uncharacteristically unkind of the hon. Gentleman. I hope to reassure him. We need to be clear about all the relevant matters. 
 The clause is about ensuring that action can be taken on services that have patently failed, presenting a risk to vulnerable people—adults or children. Of course we want to be as open as possible about the action that is being considered. We want to be able to include users and carers in making decisions about the services that they depend on. We need to talk to people as soon as we can about the intentions that may lead to the power of direction being used. However, throughout all those discussions we must keep in mind why we are considering intervening. The reason is to protect vulnerable people. 
 We will not intervene lightly, or without giving organisations an opportunity to work to improve services themselves. In fact, we expect that there will be a such clear process. However, what we are proposing will be part of an existing process. There is no question of inventing yet another new approach. We will use existing mechanisms such as performance management, monitoring, reviews, inspection and intervention powers, to give the Secretary of State another option with respect to the use of partnership arrangements. 
 Clearly, however, where patient or client safety is a matter of immediate concern, action might need to be taken more swiftly. Or, indeed, as the situation developed, advice was provided and the underlying causes in the failure of services were identified, the Secretary of State or the National Assembly for Wales might consider other models of intervention under best value or through the modernisation agency. The power is therefore not intended to replace current performance management or intervention powers but as an additional tool, where appropriate. 
 As to amendment No. 305, representatives of statutory representative bodies will be closely involved in considering and implementing the directed partnership 
 arrangements. Therefore there will be an opportunity to comment on what is intended, and their views, together with those of others, will be taken into consideration before the final decisions are made. I have made it clear in other statements to the Committee that the more we listen to users and users' representatives about the best approach, the more likely we are to get our proposals right, and the more likely we are to be able to respond to their needs. 
 Amendment No. 297 relates to best value. The power that we want to introduce does not interfere with other responsibilities of the relevant bodies, including the duty of best value placed on local government by the Local Government Act 1999. Local authorities are of course required through best value reviews to improve their services. Those who do that well and in the spirit of the legislation have nothing to fear from the clause, because they will be acting in the best interests of the users and the local community. Best value is intended to improve services. Our power of direction is aimed at doing the same when there is a need to intervene. 
 We have considered the impact on the authority's best value duty in circumstances in which a social services function was found to be failing. The Local Government Act 1999 is clear. Where there is failure local authorities can be inspected, rather than carrying out their own best value review. The power of direction will be used when there is clear evidence of a need for the use of the partnership arrangements. The services will have been inspected and we might need to act. We would not be able to wait in the wings for the completion of a lengthy process that could be a stalling tactic. Our concern at that point would be the needs of users and carers. I agree with the hon. Member for Sutton and Cheam that the duty of best value needs to be fulfilled. The power of direction will be used in the context of the powers that relate to best value. A best value review at the point in question would not help and might delay and confuse the issue. 
 The hon. Member for Runnymede and Weybridge referred to the Secretary of State's power to make regulations governing the use of his powers under clause 46. I do not want to add to what I said in relation to clause 45 and the amendments. We expect a proper opportunity to exist for effective consultation of local groups on the use of the powers. That is how we intend the procedures to be used and activated. I am sure that the hon. Gentleman will understand that we may need in some circumstances to act quickly and decisively. The rationale of the clause is the interests of those who use social services and of national health service patients. We must serve their interests always. We expect consultation to be an essential part of the process.

Paul Burstow: Will the Minister tell us a little more about the arbiter?

John Hutton: We will have to set out some of the details of this in the guidance and regulations that we intend to use. I knew that the hon. Gentleman would not like that. We will certainly not be hatching our own proposals in Richmond house. We want to discuss the details of this provision very closely with the Local Government Association, the Audit Commission and others to make sure that we get it right. The role of the arbiter, therefore, will have to be developed. We want him particularly to help us to determine the amount of resource transfer that might be necessary where agreement cannot be reached between the parties. The hon. Gentleman will accept that that is a difficult area and that we want to make sure that the arrangements we put in place for dealing with the issue are sensible and fair to all the parties involved.
 For the reasons I have tried to set out, I would advise my hon. Friends not to accept the amendments.

Philip Hammond: I listened carefully to what the Minister said and, as I anticipated, he has indicated that, under regulations that the Committee obviously does not have the benefit of scrutinising, it is his intention to ensure that in normal circumstances there will be the type of consultation that we are discussing. If the Minister is right in saying that the clause 46 option would be pursued only in extreme circumstance and as a last resort, he should expect the conclusion of that consultation to be pretty much a foregone one. He would probably expect the Secretary of State to intervene and instigate the process only in response to representations from patient representative bodies. Indeed, if patient representative bodies have not noticed the problems in service delivery, it has to be questionable as to whether those problems exist.

John Hutton: The hon. Gentleman is trying to have his cake and eat it. He wants consultation and he now realises that there will be consultation. However, he is unhappy that, in his view, it will almost invariably support the conclusion that a care trust should be set up. That is a rather unreasonable position.

Philip Hammond: To quote the Minister back at himself, he is being slightly ungracious. I was going on to say that that is fine and, as far as it goes, it is reassuring. We would then have had the usual complaint that we would have preferred the provision to have been included in the Bill. I still fail to understand why it is not possible to put a reference to measures that the Government seem to take as read—such as consultation—into the Bill.
 I was slightly alarmed, however, to hear that the Minister would not rule out an alternative scenario where there had to be an emergency intervention. In that situation, the Secretary of State would need to intervene without going through the due consultation process because of some urgency. The Secretary of State already has considerable powers of intervention where the safety of patients or of people receiving social care is at stake and it is necessary to act quickly. Indeed, in the past three years there have been examples of failing social service providers and on each occasion the Government intervened rapidly to ensure that a situation that was potentially dangerous or seriously disadvantageous to patients or users of services was contained and addressed in an appropriate way. The Government do, therefore, have powers to intervene in an emergency. 
 I am not sure whether it would be appropriate in an emergency for the Government to intervene using the powers under clause 46 to create what is intended to be an on-going and continuing situation—a care trust or a directed partnership arrangement. By definition, anything that is intended to endure into the longer term needs to be carefully thought out and worked up as a scheme, rather than imposed in the heat of the moment in reaction to some urgency. We are concerned that Governments are sometimes under political or media pressure to be seen to be doing something in response to a particular event—perhaps one that shocks the public and attracts the interest of the media. Sadly, only in the last week there was an example of an event that was particular shocking and demanded a response. However, we are now beginning to ask ourselves whether the response might deliver more problems in the future than were anticipated at the time. 
 Whenever Conservative Members are tempted to reach for legislative solutions, we have a habit of saying to each other ``dangerous dogs'' as a reminder that legislation that is entered into rapidly may not always prove to be the best thought-out and most effective legislation in practice. 
 We have concern that this route would be followed, as a result of press pressure and public opinion, in order to be seen to be doing something in reaction to a particular problem. I would be dismayed if the Government were to use the provisions in clause 46 without the proper consultation with statutory bodies on the grounds of urgency when the Secretary of State has plenty of other powers to intervene urgently. It is wholly inappropriate to create long-term structures on the back of an envelope, as it were, in response to pressure to act immediately. 
 I was reassured by what I take to be the 99 per cent case—the Minister's assurance that in the normal course of events there would be a proper consultation before any action was taken. As I said earlier, if services were really failing, I take it as read that the statutory representative bodies would support action being taken. I have already said that we intend to oppose clause 46 on stand part, therefore, there is no point in pursuing the amendment further in the light of what the Minister has said. I beg to ask leave to withdraw the amendment. 
 Amendment, by leave, withdrawn.

John Hutton: I beg to move amendment No. 265, in page 40, leave out lines 22 to 24 and insert
`considers would, if exercised under or in accordance with the arrangements in question, be likely to contribute to an improvement in the exercise of the function referred to in paragraph (a).'
 The purpose of amendment No. 265 is to clarify the intention behind using the intervention powers that are designed to improve a service that is actually failing. Our intention is to improve services that failed users. This is clear and unequivocal and a proper role for Government. We want to make that very clear in the wording of the Bill and that is what the amendment is designed to do. I hope that it will reassure some organisations that have expressed concern that the Bill as currently drafted will allow a range of other local authority functions to be drawn within the powers under clause 46. 
 In moving this amendment, our aim will be to improve the services that have failed and to ensure that other functions are included in the delegation only if they can contribute to the improvement of the failing service. Let us be clear that it does not mean that failing to deliver an orange badge scheme, for example, will lead to social services being stripped away—as some wilder speculation has suggested. The orange badge scheme is not even a social services function, and so could not even trigger the intervention powers in the first place. The amendment is designed to clarify the Government's intentions and to make it quite clear what functions could be covered by the scope of an order under clause 46. 
 Amendment agreed to. 
 Question proposed, That the clause, as amended, stand part of the Bill.

Philip Hammond: I am sorry to disappoint the Government Whip if he thought we were going to get through clause 46 before lunch, but I am afraid that I need to raise some issues.
 As has already been well-rehearsed, the jury is out on the concept of care trusts, but we are broadly supportive of it as long as the initial schemes are properly evaluated and decisions to proceed are made on the basis of the evidence available and are entered into voluntarily. These partnership arrangements depend essentially on people working together and people cannot be coerced into working together. 
 Clause 45 stands in sharp contrast to clause 46 where the Government— 
 It being One o'clock, THE CHAIRMAN adjourned the Committee without Question put, pursuant to the Standing Order. 
 Adjourned till this day at half-past Four o'clock.